Donald Trump was not kidding when he said he was going to stem the tide of new regulations affecting American businesses. The effect in the banking area has been an astounding collapse in activity at the banking agencies. During the first four months of 2017 there has been a dramatic reduction in new and proposed regulations. A comparison to 2016 will highlight these differences across the 10 federal agencies that we follow in order to prepare the regulatory newsletter.
New Final Regulations 17 3
Proposed regulations 14 2
Final tally is 31 to 5. These numbers do not include all of the various notices and requests for information that the agencies regularly send out. In addition, the non-regulatory advisories and guidelines have also noticeably dried up during this year. Dodd-Frank rulemakings have pretty much stopped even though there are scores of rules that still need to be finalized if the law is ever to be fully implemented.
Since the new year, there have been 13 federal bank regulatory developments of note and a few of those were Presidential notices and not regulatory actions. During the same period in 2016, there were 64 regulatory developments worth noting.
It would be too boring to count up all the pages of rules and compare the current tally with 2016, but the ratios are probably close to the numbers quoted above—basically an 80% difference in output.
The President issued a Notice in early February published in the Federal Register where he instructed the federal agencies to remove two existing regulations every time they adopted a new rule. I have not seen any evidence that this is occurring and there are plenty of “rules” that could be removed if needed to adopt new regulations. In fact, the agencies are probably ruing the removal of the old OTS regulations and the old rules that were moved over to the CFPB for enforcement.
In the meantime, it will be interesting to see whether legislative changes—such as a new version of the old Glass-Steagall Act—will rev up the regulatory process in response.